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On the economy and JOLTS

Talk about missing the boat – wonk style. Yesterday I was largely away from the computer (taking the kiddo to a theme park), which of course meant that everyone had to release their charts of the year. This was akin to an early Christmas present for someone like myself, but couldn’t have come at a worse time. However, I’m truly grateful for the work that goes into these and certainly won’t let them go to waste.

For now I’ll just quickly pull two such graphs because I believe they reinforce something that I wrote here:

Thus, trying to make a policy justification behind drug-testing UI applicants isn’t helped by evidence that those receiving government benefits do fewer drugs, and strikes me as largely irrelevant when there are four job seekers for every job opening.

Which is represented in graph form:

As you can see the latest data shows four job seekers for every job opening, down from a high of seven seekers per job in August of ’09.

And this chart emphasizes that such a phenomenon is generalized across most major industries:

If I were an alien observer -some great intergalactic sociologist – tasked with figuring out why those receiving Unemployment Benefits were not finding jobs, I would look at these graphs and come away with a clear answer. Which is to say that such an answer would not include drugs or GEDs. There is only one way a group of individuals (ahem, GOP) would advocate non-related policy reforms in this situation: They are approaching a problem -unemployment – with a solution based on how they think the world should be working, not based on how the world is actually working. This strikes me as a silly way to approach specific public policy issues when the data speaks for itself.

Update – Belatedly noticed this blog post by Noah Smith, which taught me that there is a term for a related argument – the Great Vacation. Though this denotes a slightly different reasoning behind high unemployment, it really doesn’t matter. Whether it’s drugs, ignorance, or laziness it’s not more prevalent or problematic than a simple lack of jobs. Smith impressively debunks the Great Vacation in a single sentence:

If the labor demand curve slopes down, then a fall in labor supply should be accompanied by an increase in wages; since wages fell or stagnated in the Great Recession and have grown only slowly ever since, unemployment is not being caused by a decrease in labor supply.